Medicare 30th Anniversary

The legislation to establish the universal health insurance system was passed on this day in 1983, six months after the election of the Hawke Labor government.

As it still still does today, Medicare is partly funded by a 1.5% levy on all taxpayers. It allows doctors to provide medical care at no cost to patients through bulk billing. Alternatively, Medicare reimburses patients 85% of a scheduled fee which allows doctors to determine their own charges with patients paying the balance. Medicare also provides for basic public hospital cover with patients able to take out additional private insurance. Health professionals with a Medicare provider number are also included in the scheme.

Medicare’s history begins with Gough Whitlam in the 1970s. The health insurance scheme was developed by health economist Richard Scotton and John Deeble. Under Whitlam, the scheme was called Medibank and was a major plank in Whitlam’s 1972 election platform.

The coalition Liberal and National parties opposed Medibank. The legislation to implement it was twice rejected by the Senate. Following the 1974 double dissolution election, the legislation was again rejected by the Senate but passed at an historic joint sitting of the parliament. Medibank came into operation on July 1, 1975.

The Fraser Coalition government neutered Medibank, with taxpayers able to opt out of paying an increased levy in favour of private insurance.

The Hawke government reintroduced Medibank, rebadging it as Medicare. Financing arrangements were modified but the scheme was effectively the same as the one introduced by Whitlam.

Throughout the 1980s, Medicare continued to be criticised by the Coalition. Whilst the 1993 election is remembered as a referendum on John Hewson’s GST, changes to Medicare were also an issue. For many years, bulk billing seemed to be at risk from a change of government. The 1993 election effectively led to bipartisan support for Medicare and it was unchanged during the 12 years of the Howard government from 1996.

Two days out from the 2013 federal election, the ALP has produced the flyer shown below. Whilst there is no suggestion that an Abbott Coalition government will tamper with Medicare, the flyer illustrates the ALP’s political and emotional attachment to the scheme.